*1 affecting the trunk of tbe tree domiciliary whose roots were sunk soil. deep Pennsylvania There is nothing- in the record which even remotely that suggests tree was ever up and dug replanted Florida.
Decree affirmed. Costs on appellant. Appellant.
Commonwealth v. Mason, Argued January J.,C. Before 1955. Stern, JJ. and Mussianno, Chidsey Jones, Bell, Stearns, *2 Eaby, Eaby, for him Jr., Chas. W. Chas. W. appellant. Attorney Special Deputy McCauley,
Daniel J. Jr., Attorney, him orb, with William C. St District General, Attorney appellee. for and Frank F. Truscott, General, by March 1955: 14, Opinion Mr. Bell, Justice Pennsyl- violating for Defendant was indicted P. L. 70 24, 1939, 748, Securities Act of June vania by seq., the Act re-enacted and amended PS et §31, July seq. PS After P. L. 70 et 1941, §31, 317, jury waiving he tried and convicted and a trial was undergo pay im- sentenced to a fine of and was $200. Supe- period prisonment for of three months. The a judgment of sentence of the rior affirmed Court appeal. and allowed an lower Court we Tlie pertinent of the section Securities Act, supra, is “Any dealer salesman who shall State, §22: without being registered (b) engage ... hereunder, to effect business holders of securities the sale thereof a hereunder through person registered order otherwise, directly indirectly,* pro duce funds to other sold such pay investments dealer or by such salesman for a . . . shall be dealer, guilty . . misdemeanor . .”** called on testimony shows defendant Christian R. at his home in Lancaster County, Martin, three times early of 1952. The evidence during part meagre does disclose at instance these not whose were visits made. these Martin’s During visits to home, who Martin, and deliv- years endorsed age, *3 ered to Mason 40 shares of following securities: Consumers Power 20 Radio Corpo- shares of Company, ration of 12 shares of Central Illinois America, Light 420 Allied Company, shares of Chemical Company, Inc., 600 shares of Utah-Idaho 100 shares Sugar Company, Xropp Defendant never Forge Company. regis- tered as a dealer for deal-' registered or a salesman any er with the Pennsylvania Commission. De- Securities fendant Martin return gave for his leases securities on 200 acres of land in San Miguel New Mexi- County, co. The Mexico original covering lease New lands showed that the rental for anmial acres amounted 3,760 to an acre. by The over Martin -10† securities turned had a market of value at the time their de- (calculated but of and all two of these were livery) $5,744. listed on the New York Stock Exchange. disparity value is tremendous. told Mr. obviously defendant * throughout, Italics ours. **'Unfortunately compre- amendment is not clear or as April 13, 1927, 273, hensive as of L. §22 §22. the Act of P. 70 PS
312 purpose money of for that he needed an oil
investing Petroleum Co., Inc., in the Tri-State venture. appeal principal on this contention
Defendant’s money passed, Mar- the transactions no that since exchange stocks of certain tin “an even involved consequently not a violation leases” and was certain in this conten- no merit Act. There is the Securities of tion. to that it is Act Securities states
The Title of the
regulation
registration
of certain
provide
“for the
contracting
selling,
or
to sell
entities
individuals and
dispose
offering
attempting
dispose
solicit
or
of,
of,
inducing
ing
buy,
thereof to ex
holders
or
offers to
including
change,
securities
defined herein,
securities
engaging
by
in the business of
them,
issued
in order
effect the sale thereof
holders of securities
pay
produce
sold
for other investments
funds to
2(b)
the Act
the terms
defines
. .
.” Section
them .
every
including
“. . .
contract
“sale” and “sell”
dispose
attempt
disposition
or offer
of,
of,
sale or
security
buy,
interest
of an offer
solicitation
security,
statutes
be
. . .”. Penal
must
in a
for value
Statutory
strictly
§58
Construction
construed:
May
P. L.
PS
Smith v.
§558;
1937,
1019,
Act of
28,
2d
Labrum v.
A.
Common
417;
372 Pa.
Messner,
Philadelphia,
Company
register regulate in- and in order to protect bonds other securities or un- or from vesting inexperienced public designing Cf. v. scrupulous Woods, salesmen. Commonwealth Act Superior undoubtedly Pa. was Ct., supra. intended to and include sales cover unconscionable exchanges such as occurred case. present not
Appellant justi- also that the evidence did urges fy the lower Court in Mason finding “engaged the business of Christian R. He re- Martin”. lies on chiefly answers following given by “Q. on cross-examination: an you And made trade even Q. for that stock? A. Yes. And there was no force inducement used you to to do it? it get You did will- Q. ingly A. I . cheerfully? myself. did . . And it, are you perfectly satisfied whole 3 transac- tions? A. Yes.” To say that Martin not induced to part with his securities because he was not forced or coerced into delivering his to stock Mason or because he did it willingly puts too a restricted on the meaning word “induce”. Webster’s New International Diction- ary (2nd ed.) defines “induce” as: “To lead on; in- fluence; prevail on; move or in- by persuasion . fluence . on or .; bring about; cause.” effect; It would be stretching our credulity beyond the breaking- point to believe defendant’s contention that he did mot induce. Martin- to dispose his valuable se curities -for unknown and relatively worthless leases in New as to which Martin Mexico, without this in ducement could have had little or no De knowledge. fendant did not take witness stand to explain justify his what he has the to call temerity actions an “even exchange”. The Judge acting jury could reasonably and find justifiably from the evidence that this grossly unfair was not exchange proposed or in *5 or effected about or brought Martin but was by
duced this on gullible when he called defendant by induced told Martin he defendant at that home; man his old in a investing the for the money purpose of needed tes actions and and that Martin’s petroleum venture; this of incapable showed him be timony the induce himself from of protecting transaction or The law unscrupulous salesmen. ment of designing in protect broad to sufficiently and is designed from the machinations gullible persons experienced who attempt of salesmen unregistered and inducements sell or of dispose valuable persons-to such persuade of for a amount cash or securities securities small relatively little value.* which are worthless of sentence is affirmed. judgment of by Dissenting Opinion : Mr. Justice Musmanno an Mason is may It be that defendant Edward on financial sins many swindler with as unparagoned Serge posthumously his head have been attributed be may imposter Eubenstein. It that he' is an richly from a de- point view, first water moral and, some I am how- punishment. serves mundane afraid, on desire ever, part understandable' Majority the lower Court and the court, Superior they Court punish to' malefactor presumed law which will future laying are down ensnare somé honorable business men in en- perfectly engaged tirely legitimate' innocent and transactions. "superstructure, of Section of the Penn- 22(b) Act on. Securities .is" built the' word- ..sylvania. “induce,” n “induce” in. :.not itself '.does denote or connóte ..but. evil. order, (cid:127) .produce-funds to-pay *.In for other investments sold . such.salesmen. . One may induce another to to take a go trip, dinner, *6 buy to a securities with no evil house, exchange in purpose mind and with no to the resulting harm person accepts who the on the dinner, journey, embarks purchases the In- house or the securities. exchanges ducement is not it is it not not is extortion, deception, fraud. In the whole world on fact, business revolves the of axis inducement. is Advertising inducement, salesmanship inducement, letter is induce- writing life, ment. Remove inducement from the current and n rivers of commerce would the reservoirs in- of shrink, vestment would the wheels of stagnate, industry would rust. In every convention and consulta- conference, tion someone is to trying induce someone else do to and something, so the long as inducement speaks with of lips honesty and appears on the table forth- right there dealing, can be no But under this wrong. any decision almost between on meeting business men subject of securities fall under the may shadow suspicion and the be participants may liable to' prose- cution under Section of the 22(b) Securities Act.
If it was the purpose of the Securities Act to abso- lutely prohibit and dealers salesmen from any taking in part the business of securities unless registered, Act should have so stated. But it does not so state. Tt merely says that if one in the engages business of to inducing others do certain in things not themselves criminal he will be guilty, I misdemeanor. read ..As the record there is case, to nothing show that the defendant Mason in the in- “engaged business holders of ducing securities effect-the sale-thereof.” The record shows-.a 'meeting.between. Martin Christian and Edward- Mason-,-repeated two...occasions, to.:ex- on. n change- securities. How does- this become '.“engaging (cid:127) business, Engaging business?” ..holding -means oneself out buy, sell;; or exchange generally barter special clientele—not with a world whole merely person. one R. that Christian no evidence contains
The record As to defrauded. overreached deceived, was “Q. That exchange he testified: of securities first that stock You traded it? wasn’t trade, an even Certainly. no Q. there was And A. oil stock? Q. compel you You did it? A. No. do used to force willingly? A. Yes.” it “Q. And he testified: transaction,
As to second Q. you A. Yes. And for that stock? even trade made an you get used no force or inducement there was cheerfully? willingly I did A. did it do it? You *7 myself.” it, testimony “Q. And that as follows: his
He concluded the other? same circumstances as done under the Q. you A. Yes. Q. those leases? A. And still have Yes. you perfectly the trans- whole 3 And are satisfied with you Q. Mr. knew when A. Martin, actions? Yes. Now, you from the State these were securities did this they in leases the State of New Mexico, New oil Mexico, A. Yes.” New Mexico securities? were given Martin to Mason were not The securities appellee printed endeavors but record, leases in its brief that the which received show to the stock which he delivered were inferior value appellee says exchange. in its Thus to Mason “It that the values of the shares of brief: is submitted readily as com- determinable matters of stock are so judicial knowledge no- mon this Court could take of such . . .” values; tice judicial knowledge I
I of such values. cannot take they are. are not un- do not know what Stock values contrary, they changeable. On are as Variable as as the as inconsistent waves of weather, sea* unpredictable politics. as Latin-American To con- vict a man on unstable a so foundation is to build a policy on quicksand. law
Tbe section of tlie statute under wbicb this convic- tion has taken is a place scattershot weapon. While presumably at a it aiming specific target can hit any- body. it strikes Mason Today who be a may wolf in Tomorrow it hit a sheep’s clothing. may real sheep. some conventional Despite misimpressions in this business men are generally in an direction, engaged honorable and should not be honest, calling hamstrung, and harassed badgered by vague, and inde- rambling cisive legislation.
Leiper, Appellant, Heywood-Hall Construction v.
Company. *8 1955. Before Argued January J., C. Stern, Ciiidsey Mand JJ. Jones, Bell, Stearne, usmanno,